What Communities Give Up: Data Center Tax Abatements, Line by Line

Updated: September 3, 2026. Every statute citation, dollar figure, and percentage below was taken from the source listed at the bottom of this page and checked on that date. Where a number comes from a news outlet or an advocacy organization rather than a statute or a government document, we say whose number it is in the sentence itself. Where we do arithmetic on published figures, we show the division so you can check it.

How to cite this page: SueDataCenters.org, "What Communities Give Up: Data Center Tax Abatements, Line by Line," updated September 3, 2026, https://suedatacenters.org/guides/data-center-tax-abatements.

One framing point before the numbers. Tax incentives are a policy choice, and communities that grant them cite real benefits: construction employment, infrastructure that would not otherwise get built, and a much larger tax base once an abatement expires. Those benefits are documented later on this page, including the Virginia county where data centers now supply 31 percent of all local tax revenue. The argument this page makes is narrower. It is that the arithmetic is usually available and is usually not presented, and that a resident is entitled to see it before the vote.

People use "tax break" for six different things that work in different ways, are granted by different bodies, and are challenged, if at all, in different forums. The single most useful distinction is between a statutory exemption, which the legislature wrote into state law and which every qualifying project receives as of right, and a negotiated local deal, which a county commission, city council, school board, or development authority votes on and can decline.

Two practical consequences follow. First, if your objection is to the statewide sales tax exemption, the county commission is the wrong room; that argument belongs to the legislature, and several legislatures are now having it. Second, the terms most within local reach are the ones that show up last in the process and get the least public attention: the community benefit schedule, the road security amount, and the decommissioning security.

The qualifying thresholds are the clearest evidence of what these programs are designed to reward. In every state below, the binding test is a capital investment number. Job requirements, where they exist at all, are small relative to the investment, and in Iowa there is no job requirement in the exemption statute at all.

Read the Georgia tier again, because it is the pattern that matters most to small counties. A rural Georgia county of under 30,001 people gives up the sales tax on a data center campus in exchange for a statutory promise of five jobs. Read the Ohio line the same way: $100 million of investment and $1.5 million of payroll, which at a $75,000 average salary is roughly 20 people, with no headcount floor at all.

How common is this? Virginia's legislative auditors counted 34 states with a data center sales tax exemption in 2024, and noted that "all states bordering Virginia provide a sales tax exemption to data centers." Good Jobs First put the count at 36 states in January 2026 and referred to 37 states in June 2026. Nebraska eliminated its data center sales tax exemption in 2026, according to Good Jobs First. Nebraska then went further: Executive Order 26-17, signed July 20, 2026, barred new data centers from the ImagiNE Nebraska Act incentive program, and LB1010, approved April 14, 2026, now requires data center operators to bear decommissioning costs and sign community benefit agreements with affected communities. See our Nebraska page for the full sequence.

Until recently most states did not publish a figure. The ones that now do have revised their estimates upward repeatedly, and by large multiples. Good Jobs First, a subsidy watchdog that tracks these programs, compiled the following in its June 12, 2026 report "Even Cloudier with a Greater Loss of Spending Control." These are the states' own disclosures, gathered by Good Jobs First:

The Ohio number produced a policy response. On the heels of reporting by Signal Ohio that the break cost more than $1.5 billion in 2025, Governor Mike DeWine directed state officials to pause consideration of new data center sales tax exemption applications, a step Policy Matters Ohio described on May 28, 2026 as "a clear acknowledgment that something has gone seriously wrong." The pause does not touch existing agreements, which is where the 2025 cost came from.

Two independent state evaluations have asked the harder question, which is whether the exemption pays for itself. Virginia's Joint Legislative Audit and Review Commission found in its December 2024 study that the data center exemption returns 48 cents in state revenue per dollar spent, against 41 cents for the average Virginia incentive, and concluded that "the data center exemption does not pay for itself when considering just the state portion of the exemption cost and the state return in revenue." Georgia's state auditor, using a report prepared by the University of Georgia's Carl Vinson Institute of Government in December 2022, modeled a hypothetical $800 million hyperscale facility and estimated forgone state revenue of approximately $80 million against roughly $19.4 million in additional state taxes during construction and $250,000 to $275,000 a year from operations. That 2022 evaluation assumed 90 percent of Georgia data centers would not exist without the exemption. Good Jobs First reports that a December 2025 update of the same Georgia audit found the opposite direction of travel: that 70 percent of data center projects would have located in Georgia even without the subsidy.

Four deals, all documented, showing the full range from no abatement at all to a 30 year, 65 percent write-down.

Barber County, Kansas: Google Project Helium, approved August 31, 2026. No abatement. The county's own deal summary and press release state the terms. Google pays 100 percent of applicable ad valorem property taxes with no property tax abatement, projected at approximately $327.5 million over 20 years to local taxing jurisdictions, about $138.4 million of it to the county. For scale, the county's entire assessed valuation is $115,465,673 and its total 2026 ad valorem tax is $6,768,132; the project's projected assessed value alone is $116,875,000. On top of the taxes: $5.5 million in community benefit payments on a published schedule of $500,000 by the end of 2026, $3 million in 2027, $1 million in 2028, and $1 million in 2029; an estimated $1 million to $1.5 million a year in sales tax on Google's electricity purchases; $5 million in road security with pre-construction and post-construction road inventories; and decommissioning security "equal to 125% of the estimated cost to decommission the project." The agreement guarantees a minimum of 300 full time equivalent jobs by the fifth year of operations.

The county headline is not the whole tax picture, though. No county abatement does not mean no subsidy, because the two taxes are levied by different governments. Kansas Senate Bill 98 created a separate state sales tax exemption for a qualified data center, and its enrolled text sets the terms: a firm must invest "at least $250,000,000 in the aggregate by the fifth year of operations," must create "and maintain at least 20 new jobs" within two calendar years of commencing operations, and in exchange "the sales tax exemption shall be valid for 20 years after the date of commencement of operations." Eligible costs expressly exclude the cost of electricity, which is why Barber County still expects sales tax revenue on Google's power purchases. Taking the statute at its floor, and this division is ours, $250 million of qualifying investment against 20 required jobs is $12.5 million per required job, held for twenty years. The county negotiated its property tax to full value. The state exemption sits on top of that and was not the county's to trade away. Two provisions in the same bill cut the other way and are rarely mentioned: SB 98 prohibits public utilities from authorizing discounted economic development electric rates for data centers, and it requires a qualified data center to be reviewed and approved by the Kansas intelligence fusion center before public financial assistance is awarded.

Our report on the Barber County development agreement covers how it was approved, which is its own story.

Effingham County, Georgia: OpenAI, memorandum of understanding signed July 21, 2026. WTOC reported from county records that the PILOT assesses the property at 25 percent of value instead of the standard 40 percent, cutting the property tax bill by 37.5 percent annually for the first 15 years of each project phase, and locks the calculation at the 2026 millage rate for the full 15 years, insulating the company from later local rate increases. The station reported a $20 billion project, at least 400 new long-term jobs averaging 80 per phase, and a buyout option letting the company repurchase the property from the county for $10 when the abatement period ends. The memorandum was signed on July 21 and the project was announced publicly on July 22.

Arkansas: Google in Little Rock, West Memphis, and Conway. The Arkansas Democrat-Gazette reported on June 27, 2026 that PILOT agreements give the company the maximum 65 percent tax abatement for 30 years on both real estate and personal property. On the Little Rock project, a $1 billion first building of about 300,000 square feet with potential expansion to 1.43 million square feet, the paper reported the site would generate over $12.8 million in property tax revenue without the abatement and over $5 million annually with it.

Mount Pleasant, Wisconsin: Microsoft, November 2023. No public incentives. Wisconsin Public Radio reported that under the development agreement "no additional financial incentives for Microsoft will be required by either the village or the county." Instead Microsoft guaranteed a minimum assessed value of $1.4 billion by January 1, 2028, bought more than 1,000 acres for $100 million, and gave the village the ability to close Tax Incremental District 5, created for Foxconn in 2017 and originally scheduled to close in 2047, seven to 14 years early. That is what a TIF looks like when it works in the community's favor: the increment retires the district's debt and then flows to the ordinary taxing bodies.

A hyperscale campus is one of the most capital intensive structures a community will ever host and one of the least labor intensive once it is running. Virginia's legislative auditors put the operating headcount plainly: several data center representatives told them "a typical 250,000-square-foot data center may have approximately 50 full-time workers," about half of them contract workers, which the auditors compared with one employee per 650 square feet for a distribution center. Across the entire Virginia industry, the largest data center market in the world, direct employees and contract workers together accounted for over 8,000 full-time jobs in FY23, and the industry added more than 800 new full-time jobs that year. Eighty percent of the annual jobs attributed to the industry come from the construction phase, which means the economic case depends on continuing to build.

Set those headcounts beside the subsidies. The divisions below are ours, using published figures:

• Virginia, one year of the exemption. $928.6 million in FY23 savings against the more than 8,000 existing full-time jobs is roughly $116,000 per job in a single year. Against the 800 new full-time jobs added that year it is roughly $1.16 million per new job.
• Georgia, the auditor's own model. Approximately $80 million of forgone state sales tax on an $800 million hyperscale facility with 50 permanent employees is about $1.6 million of forgone state revenue per permanent job, before any local property tax abatement.
• Effingham County, Georgia. A $20 billion investment against at least 400 promised long-term jobs is about $50 million of capital investment per permanent job, on a property assessed at 25 percent instead of 40 percent for 15 years per phase.
• Barber County, Kansas. 300 guaranteed full time equivalents by year five, with 100 percent of property taxes paid. The comparison is not to a cost per job but to what the county would have received had it abated.

Good Jobs First states the general case this way: because these subsidies "favor capital investment, not job creation," taxpayer costs "routinely exceed $1 million per permanent job." The counterweight, and it is a real one, is that Virginia's auditors scored the exemption at 84 jobs added per $1 million spent against 58 for the average Virginia incentive, because construction and supplier employment are counted. Whether a community values a two year construction boom at that price is a political judgment, not an arithmetic one. The arithmetic only has to be on the table.

Communities that approve these projects are not imagining the upside, and a page that ignored it would not be useful. The documented benefits:

• Local tax revenue can be transformative, especially where equipment is taxable. Virginia's auditors found that across the five localities with mature data center markets, data center revenue ranged from less than 1 percent to 31 percent of total local tax revenue. In Loudoun County it was 31 percent and in Prince William 7 percent. Localities used the money to lower real estate tax rates and to build revenue stabilization and reserve funds.
• Abatements expire. A 15 or 30 year PILOT ends, and the property joins the ordinary tax roll at full value, assuming the agreement does not contain a buyout or an extension. That is the central promise made to a county, and it is worth reading the exit provisions to see whether it holds. Effingham County's $10 repurchase option is exactly the kind of clause that determines the answer.
• Infrastructure gets built. Georgia's auditors noted that data center construction "may lead to needed investment" in electricity and water infrastructure and can improve an area's broadband, while also flagging that the facilities are high electricity and water users that could strain local resources during droughts, heat waves, or cold snaps.
• Construction employment is large and real. Georgia's evaluation estimated roughly 4,200 construction jobs and 7,300 total jobs during the roughly two year construction phase of a single $800 million facility.
• Security instruments protect the community. Road and decommissioning securities are the terms that cost the developer money if things go wrong, and they are the ones most often left out. Barber County's $5 million road security and 125 percent decommissioning security are a template worth quoting at a hearing.

The honest summary is that a data center can be a large net gain for a local budget and a net loss for a state budget at the same time, because the property tax accrues locally while the sales tax exemption is mostly a state cost. That is precisely why the two decisions get made in different rooms.

Almost all of this is public. The problem is that it is public in pieces, held by different offices, and released on request rather than published. Ask for these by name, in writing, under your state's public records act.

• The development agreement and every exhibit, including the road use agreement, the decommissioning agreement and the form and amount of the security, and any community benefit agreement with its payment schedule.
• The abatement or exemption resolution or ordinance, plus the staff report or fiscal analysis prepared for the body that voted on it, and the minutes of that vote.
• The PILOT financial agreement and its full payment schedule, including the assessment ratio, the millage lock if any, the term, escalators, clawbacks, and any buyout or repurchase option. New Jersey's guidance to its own municipalities, Local Finance Notice 2026-13 of August 25, 2026, is a good model of what these documents contain: a long-term PILOT there must be approved by ordinance after a public hearing, with notice to the county chief financial officer and the county commissioners' clerk, cannot exceed 30 years from project completion or 35 years from execution, and requires the entity to submit an annual audit to the mayor and governing body within 90 days of its fiscal year end. A short-term agreement under the state's Five-Year Law must be filed with the state within 30 days of execution. Ask your own jurisdiction which of those documents exists and where it was filed.
• The application to the state program. In Ohio that is the agreement with the tax credit authority. In Georgia it is the application, the certificate of exemption, and the annual reports the operator must file on taxes exempted and quality jobs created. In Virginia, companies using the exemption report annual eligible expenditures and benefits to the state economic development partnership. In Iowa the operator must register and file an annual report each January 31.
• The TIF district's project plan, boundary, base value, and developer agreement, plus any minimum assessed value guarantee, and the annual report showing what the district has collected and what it still owes.

Then work out the calendar, because this is where residents most often lose. The land use decision, a rezoning, a special or conditional use permit, or a site plan, is one vote before one body with a statutory appeal deadline that is commonly 30 days and as short as 10 in Texas. The tax decision is frequently a different vote, before a different body, on a different night, and often has no equivalent appeal clock at all. Our guide to zoning appeal deadlines by state quotes the operative statute in twelve states, and only the land use clock is in it. Ask the clerk three questions in writing: which body approves the tax agreement, when is it noticed for hearing, and is the vote scheduled before or after the zoning vote. Effingham County's memorandum was signed the day before the announcement, which is a reminder that by the time a project is public the tax terms may already be settled.

Finally, be clear about which fight you are in. If the objection is that a statewide exemption is too generous, that is legislative work, and legislatures in Ohio, Georgia, and elsewhere are actively revisiting it. If the objection is that a local abatement gave away too much, that is a vote, a record, and an election. If the objection is that the facility itself is harming your property, through noise, water, air, or construction damage, that is a different body of law entirely; our guides on fighting a proposed data center and who pays for data center power cover the first two, and a free case review connects you with an independent attorney in our network who handles data center cases in your state, at no cost and with no obligation. We do not give legal or tax advice, and nothing on this page is a substitute for counsel who has read your county's actual agreement.